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Iran says not supposed to pay damages to Turkmenistan for overdue debts

Iran says not supposed to pay damages to Turkmenistan for overdue debts

Teheran, July 7 - Neftegaz.RU. Kasra Nouri, a senior Iranian Oil Ministry official, said Iran is not supposed to pay any damages to Turkmenistan because of overdue payments for the latter’s natural gas exports to Iran.

Turkmen media reported, that the national Iranian gas company is obliged to pay off the debt for the Turkmen gas delivered in the period from 2007 to 2013 in the amount of about $2 billion. This decision was made by an international arbitration.

“During the tenure of the previous Iranian administration between 2005 and 2013, Turkmengaz cut off its gas exports to Iran in 3 phases, causing serious problems for resident in the northern parts of the country,” Nouri said.

“In 2013, Turkmengaz cut off the flow of gas in a bid to receive overdue payments. Finally, it was decided that the National Iranian Gas Company’s debts to Turkmengaz be paid in the form of a loan with interest as stipulated in an addendum to an agreement,” he added.

“The previous administration had agreed to pay its overdue debts at 7.5 % interest,” which, after discussions, turned into a loan at a 5% interest rate. Basically, neither had Turkmengaz requested compensation, nor had the arbiters issued a ruling that would suggest the National Iranian Gas Company (NIGC) would have to pay damages or fines to Turkmenistan, he noted.

“The arbiters simply finalized the debts of the NIGC and issued the Iranian side with an order requiring it to pay its debts to Turkmenistan,” the official underlined.

“In return, part of the NIGC’s demand for compensation over the quality and quantity of the gas delivered by Turkmenistan was accepted, and was accordingly deducted from Iran’s debts to Turkmenistan,” he said.

The official underscored that Iran has always stressed during all negotiations that it owes to Turkmenistan, and that the only reason it has not yet paid its debts is that international and banking conditions have made it impossible to keep up payments on a regular basis.

He said there has not been any conflict between Teheran and Ashgabat, and that the argument mentioned above was just a trade dispute between the two sides. The official noted that Iran has always sought good economic relations with Turkmenistan.